In this course you will learn how to use key finance principles to understand and measure business success and to identify and promote true value creation. You will learn how to use accounting information to form key financial ratios to measure a company’s financial health and to manage a company's short-term and long-term liquidity needs. You will also learn how to use valuation techniques to make sound business investment and acquisition decisions. Finally, you will learn how to incorporate risk and uncertainty into investment decisions and how to evaluate the performance of existing investments.
Upon successful completion of this course you will be able to:
• Understand how companies make investment decisions that create value for shareholders
• Use accounting statements to measure the financial health of a company
• Forecast and manage a company’s short- and long-term liquidity needs
• Measure the contribution of a new project or acquisition to shareholder value
• Incorporate risk into investment decisions using the appropriate discount rates
• Evaluate the performance of a company or divisions of a company
This course was previously entitled Financial Evaluation and Strategy: Corporate Finance. The course received an average rating of 4.7 out of 5 based on 177 reviews over the period of September 2015 through August 2016. A detailed breakdown of ratings and reviews received for the prior version of the course, which is identical in content to the current course, is provided in the course orientation page.
This course is part of the iMBA offered by the University of Illinois, a flexible, fully-accredited online MBA at an incredibly competitive price. For more information, please see the Resource page in this course and onlinemba.illinois.edu.

JF

Great course! I felt that I learned quite a bit. My undergrad is Finance and I feel that this course covered more topics and in more depth than my previous university studies.

KK

Jun 13, 2019

Filled StarFilled StarFilled StarFilled StarFilled Star

Very good. Much better than other corporate finance courses you can find on coursera.\n\nMaterials cover a broad range of topics and the explanation is clear and consise.

From the lesson

Module 1: The Objective of the Corporation and Analysis of Financial Ratios

In Module 1, we will discuss the objectives of the corporation. We will introduce the concept of shareholder value and discuss the pros and cons of maximizing stock prices. We will then learn how to calculate financial ratios that measure concepts such as liquidity, leverage, and profitability. We will work with accounting statements and financial data from real world companies and learn how to use this data to measure the financial health of companies and make comparisons with competitors.

Taught By

Heitor Almeida

Transcript

[ Music ] >> As we talked about in the introduction this module, accounting is the language of corporate finance. Right? So we're going to learn now is how to use financial ratios to measure key corporate finance concepts. we're going to be dealing with the major financial statements: the balance sheet, the income statement, and the cash flow statement. And then we're going to try to really put words to the numbers and make the financial statements live and really try to think about what can we see there. Okay? What sort of important corporate finance concepts can we learn by looking at initial statements. Let's start with balance sheets. Okay? So that's going to be the first set of financial statements we're going to be looking at. we're going to spend quite a bit of time thinking about balance sheets. Okay? Before we get into real world examples, which is really how I want to do this, I want to do this calculations using data from real-world companies, but before we do that, let's just start with a simplified example where we are comparing three firms here. We have Firm A, Firm B, and Firm C, okay. And here you can see all their-- a snapshot of their balance sheets, right? A real world balance sheet is going to have many more items than that, here we just have the basic items. Assets, liabilities, and assets and liabilities are split into current and noncurrent, and we also have information on the equity which is the difference between assets and liabilities. Okay? So ask yourself what kind of information can we get by looking at a balance sheet? Okay? The first thing you notice is that the balance sheet will give you information on, you know, how large the company is. How much-- you know, how much assets does it have? Right. In this case, the three firms have $500,000 or $500 million. Let's say $500 million in assets. Okay? And then we can look at the liability side, right? And here you can notice that there are some differences. Right? So if you look at this, Firm A has $200 million in current liabilities; Firm B has just $50 million. Okay? Both companies have the same amount of total liabilities, but Firm A has more current liabilities. Okay? So, one thing we're going to do this lecture in this module, is to think about what does that mean for the liquidity of the company. Okay? So, and that we look at Firm C, the main difference is that Firm C has fewer liabilities then Firm A and Firm B. right? So another concept we are going to talk about is solvency which is going to be a difference between Firm B and the other two firms. Okay? So, these are the key concepts we're going to be talking about, liquidity and solvency. And rather than using these simplified example and made of examples, what I want to do is to use data from three real-world companies to illustrate these key concepts. Okay? So we're going to take two companies that are competitors. The first one is Cablevision which is a leading telecommunications company here in the U.S., right? They provide mostly digital television; also high-speed Internet, okay? And one of Cablevision's major competitors which is DirecTV, which again is a major provider of digital television, actually DirecTV is more of an international company, right? They are a U.S. company; they are also operate mostly in Latin America. It has more than 37 million customers around the world. Okay? And for reasons that you will understand soon, we're going to talk but a third company in a completely different industry, which is B/E Aerospace. What BE Aerospace does is they make aircraft cabin interior products. Things like seats, you know, aircraft seats. They make those both for commercial and business jets. Okay? So of course it is a completely different company; you will see why we have that in the analysis we start talking about liquidity ratios. So those are the three companies we are going to analyze, and now we are really going to try to get into the financial ratios and see what we can learn about these companies by reading their accounting statements. [ Silence ]

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